The Protective Convention Against the Risks of the Restrictions on the Foreign Exchange

Abstract

Abstract One of the most important factors that drive the foreign investor to venture and invest his capital outside the borders of his country is the opportunity to achieve abundant profit that cannot be achieved in investment within his country.Accordingly, the measures taken by the host country that would affect its percentage of profit are among the most important obstacles facing foreign investment. These measures are the laws on foreign exchange control and the restrictions on the transfer which are followed by the majority of developing countries as a way to reduce the demand for foreign exchange in a way that does not strain National balance of payments . Moreover, It works to achieve a significant increase in its cash reserves to keep the external value of the currency from deteriorating. There are also measures related to tax policy that would increase the investor’s material burdens, which often discouragee him from undertaking many important investment projects for the developing countries.